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NFTs: A Beginner’s Guide to Non-Fungible Tokens

If you’ve been following the world of cryptocurrency, you may have heard about NFTs, or non-fungible tokens. But what exactly are NFTs, and why are they generating so much buzz in the art and collectibles world?
First, let’s define fungibility. Fungible assets are interchangeable, meaning they can be exchanged for something of equal value. For instance, the value of a $20 bill stays unchanged if it is exchanged for two $10 bills. This is not the case with non-fungible assets, which are unique and cannot be exchanged for something of equal value. A good example of a non-fungible asset is a rare piece of art or a collectible item like a baseball card.
So, what does this have to do with NFTs? NFTs are digital assets that are stored on a blockchain, like cryptocurrencies like Bitcoin and Ethereum. However, unlike cryptocurrencies, NFTs are unique and cannot be replicated or exchanged for something of equal value. This makes them ideal for representing rare or one-of-a-kind items like digital art, music, and video content.
To understand how NFTs work, let’s look at the process of creating and selling a piece of digital art. First, an artist creates a digital artwork and saves it as an NFT on a blockchain platform like Ethereum. The NFT includes information about the artwork, such as its title, artist, and a unique identifier that makes it one-of-a-kind.
Once the NFT is created, the artist can sell it on a marketplace like OpenSea or SuperRare, using cryptocurrency to complete the transaction. The buyer of the NFT then becomes the owner of the unique digital asset, which they can display or trade on the marketplace.

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